Technology adoption and value chains in developing countries: Evidence from dairy in India

Abstract

Adoption of modern technologies in agriculture is crucial for improving productivity and welfare of poor farmers in developing countries. Not much is known about how value chains do (not) affect technology transfer and/or adoption in food chains in developing countries. We analyze farm-level technology adoption in the dairy chain in India, using unique survey data. The dairy chain in India is an important case because the Indian government has promoted development of the dairy sector for its potential for ‘pro-poor’ growth, and because value chain initiatives had strong effects on dairy farm technology in other countries with imperfect markets and growth in demand. We find that despite rapid growth in milk consumption and production, technology adoption in the form of better hygienic practices, better feed and improved livestock was mixed, and low for certain regions and technologies. So far, the role of value chains in the adoption of new technologies seems to be minor.